Small businesses have typically had little to do with big data. That’s primarily because most owners have thought coping with it was too difficult, too expensive and just plain intimidating—notions that have generally sidelined the use of such information for anyone outside of the large corporations’ ballpark. Without it, smaller players have historically relied more heavily on something their larger counterparts could only dream of—a personal relationship with their customers. Today, however, big data isn’t just for the big guys.
Small businesses need a deeper understanding of their customers—just like large ones do. Consumers evolve, businesses—both big and small—grow and the relationships between them change. So that means the local bakery needs more than just a fresh croissant waiting for Bill in the morning to keep him loyal. Nevertheless, many small businesses still hesitate to leverage big data. In looking at responses from a recent Nielsen poll of 2,000 small businesses in the U.S., 41 percent think conducting market research is too costly, and 42 percent say they just don’t have the time. And even more surprisingly, 35 percent went so far as to say they’ve never even considered it.
“Going forward, the companies that have the best data will win,” says John Jantsch, small business consultant and author of “Duct Tape Marketing.” “It doesn’t matter what industry you’re in or how big or small your business is. Until you can understand precisely what your customer wants, what they don’t want, how they want it and when they want it, you’ll be left to guess—and guessing is a very, very expensive business sport.”
But small businesses have another reason to dig deeper. Large companies are now using big data to offer similarly personalized service—the one area where they couldn’t measure up in the past. With the explosion of new technology, cloud computing and social media, companies have created experiences that adjust automatically, respond in real time, predict problems before they occur and deliver more tailored services to consumers. These advancements have created a new standard for interacting with consumers, and they’ve leveled the customer service playing field in the process. So today, any business can offer great service, fair pricing and timely follow up with the right tools and strategy.
The good news for small business owners is that the data boom isn’t reserved for large corporations. Smaller shops may not have the same volume of data available as big businesses—and they certainly don’t have an army of analysts hammering away on algorithms—but they can capitalize just the same. Thanks to a handful of modern, easy-to-use programs, they can collect and analyze data to develop better solutions that meet the growing desires of today’s consumers.
“Regardless of size, every organization has a need for data and the insights that data can generate. This is especially true when it comes to the challenge of finding your most valuable consumers,” says Beth Brady, President, Nielsen Segmentation and Local Market Solutions. “When you have the right data, combined and analyzed from the right angle and delivered it in a simple intuitive way, the challenge of finding your most valuable customers and creating products, services and experiences that matter to those customers becomes so much easier. We believe in a future where small businesses can do this just as well as bigger ones.”
Of course, despite the variety of recent easy-to-use programs that give many small- and medium-sized firms access to more data, there’s still work to be done. The results of Nielsen’s recent poll show that even with new solutions tailored for small business, a large portion of owners still lack the expertise and the time to make good use of the information. So for small businesses to have easier access to affordable consumer data, the next wave of data solutions will need to focus on giving owners the tools and integrated services they need to turn data into practical business insights.